Larry, who owned 30 percent of the stock of LMN Inc., received as a distribution in exchange for all of his stock in the corporation, inventory worth $90,000 that had a basis to the corporation of $70,000. How much gain was recognized by LMN Inc. as a result of this liquidating distribution and what was the character of the gain? Answer A. $0 gain. B. $20,000 capital gain. C. $20,000 ordinary income. D. $20,000 Section 1231 gain